Bullion & Business Weekend Report – Jan. 23

Precious metals plunged this week as prices began tumbling Wednesday as the US dollar advanced on investor concerns over China-curbed lending. The metals suffered another blow on Thursday following President Obama’s proposal to increase bank regulations as a means to limit their risk-taking.

These two factors were commonly cited as reasons for pulling down other markets. The China news hit crude oil particularly hard. Oil prices headed toward $74 a barrel, registering a 4.9 percent weekly decline. US stocks were weighted by both events, ending the week with three session losses. The Dow experienced its worst week in nearly a year. European stocks also ended lower.

Precious metals weekly prices follow:

In London Fix bullion weekly prices, gold fell 3.9 percent, silver plunged 6.7 percent and platinum declined 3.8 percent. Gold on Friday was fixed at $1,084.00 an ounce, falling $44.00 for the week. Silver ended at $17.28 an ounce, for a weekly loss of $1.24. Platinum settled at $1,540.00 an ounce, losing $60.00 for the week.

For New York metals weekly prices, gold declined 3.6 percent, silver lost 8.1 percent and platinum retreated 3.2 percent. Gold for February delivery ended at $1,089.70 for a weekly loss of $40.80. Silver futures for March delivery ended at $16.932 an ounce, falling $1.50 on the week. Platinum for April delivery closed to $1,544.50, losing $51.60 on the week.

Notable bullion quotes follow:

"Over the past three sessions we have noted several disconnects between bullion and the greenback, most notable yesterday [Thursday], when a retracement to lower levels by the dollar (following not-so-rosy jobs data) not only failed to push bullion to higher levels, but the metal sank under its own weight due to persistent liquidations," wrote Jon Nadler, senior analyst at Kitco Metals, Inc. "As of this writing, bullion continues to feel on the heavy side"

"With fear returning to markets and investors’ minds after they had previously bought into the recovery story, most assets have been sold off sharply, including gold, helped by interest-rate-hike fears," Martin Hennecke, associate director at Tyche Group Ltd. in Hong Kong, said on MarketWatch.

"The latest selling is most likely a temporary correction, but there is still too much uncertainty to say when and where the market drop will stop," he said on Reuters, adding that for gold, the near-term support target was December’s low around $1,070."

Gold, considered a hedge during times of high inflation and economic uncertainty, tends to follow oil and move opposite to the U.S. dollar. A rising greenback makes dollar-denominated commodities, like bullion, more expensive for holders of other world currencies.

London Fix Charts: Silver, Gold and Platinum
(Jan 15 – 22)

The London Fix is one of the most used bullion quotes around the world. The London AM fix for gold and platinum begins at 10:30am GMT (5:30am in New York), and the PM fix begins at 3pm GMT (10am in New York). The London Fix for silver begins each business day at 12pm GMT (7am in New York).

London Fix Precious Metals Prices

(Jan 15 – 22)

Up

Down

Week % Change

Week $ Change

Friday Close

Silver

X

-6.7%

-$1.24

$17.28

Gold

X

-3.9%

-$44.00

$1,084.00

Platinum

X

-3.8%

-$60.00

$1,540.00

(Jan 8 – Jan 15)

Up

Down

Week % Change

Week $ Change

Friday Close

Silver

X

2.2%

$0.40

$18.52

Gold

X

0.1%

$1.25

$1,128.00

Platinum

X

2.0%

$31.00

$1,600.00

( Dec 31 – Jan 8 )

Up

Down

Week % Change

Week $ Change

Friday Close

Silver

X

6.7%

$1.13

$18.12

Gold

X

2.1%

$22.75

$1,126.75

Platinum

X

7.0%

$103.00

$1,569.00

(Dec 24 – 31)

Up

Down

Week % Change

Week $ Change

Friday Close

Silver

X

-1.9%

-$0.33

$16.99

Gold

X

-0.05%

-$0.50

$1,104.00

Platinum

X

0.7%

$10.00

$1,466.00

(Dec 18 – 24)

Up

Down

Week % Change

Week $ Change

Friday Close

Silver

X

0.1%

$0.01

$17.32

Gold

Unchanged

0.0%

$0.00

$1,104.50

Platinum

X

2.8%

$39.00

$1,456.00

*Week change numbers are for Friday PM-Friday PM ( Unless a time is closed for holidays)

Weekly World Business News: Oil, Gasoline, and Stocks Prices

Oil prices plunged Friday, and for the week "as concerns over weaker energy demand persisted, fueled in part by concerns that China might slow its growth," wrote Polya Lesova & Nick Godt of MarketWatch.

"A general malaise has crept into all the markets because of uncertainty about the Obama administration’s proposals to regulate the financial industry," John Kilduff, a partner at Round Earth Capital, a New York-based hedge fund that focuses on food and energy commodities, said on Bloomberg. "The Chinese news has also been an important factor this week."

On Friday, New York crude-oil for March delivery tumbled $1.54, or 2.0 percent, to $74.54 a barrel.

Prices at the pump fell nine-tenths of a cent between Friday and Saturday. The national average for regular unleaded gasoline is $2.718 a gallon, according to a AAA fuel report. The price is 3.5 cents lower than last week, but 13.4 cents more than a month back. Compared to a year ago, average gasoline prices have jumped 86.8 cents.

U.S. stocks closed lower Friday, and for the third straight trading day "on worries that the White House’s bank plan and China’s lending curbs will mean a broader cutback in lending. Questions also arose over whether Fed Chairman Ben Bernanke’s term will be renewed," wrote Alexandra Twin of CNNMoney.com.

"Between uncertainty over Bernanke, Obama’s bank regulation proposal and the election in Massachusetts, the market is like a cork in the water and the Democrats just hit the flush," Jack Ablin, chief investment officer at Harris Private Bank in Chicago, said on Reuters. "It looks like we’re headed really low."

For the week, the Dow fell 4.1 percent, the S&P declined 3.9 percent and the Nasdaq ended down 3.6 percent.

Friday figures for the three major US indexes follow:

The Dow fell 216.90 points to close at 10,172.98.

The S&P retreated 24.72 points, closing to 1,091.76.

The NASDAQ lost 60.41 points to end at 2,205.29.

And in other world markets:

The German DAX fell 51.65 points to close at 5,695.32.

The Paris CAC 40 dropped 41.38 points, to close at 3,820.78.

And the London FTSE 100 lost 32.11 points to finish at 5,302.99.

The Dow sealed its worst week since March 2009 as political jitters continued to plague investor sentiment. Conway Gittens, Reuters. The following weekly business recap video from Reuters discuses this and stocks:

Bullion and Business Articles

In related silver and gold news, interesting or quick-read articles from the week include:

Gold futures hit by global worries – MarketWatch
Gold futures finished the week 2.4% lower on Friday, slumping to their lowest level in a month, hit by concerns that China’s moves to curb lending will dampen growth, reducing the precious metal’s appeal as a hedge against weak currencies and inflation …

US gold ends lower as Obama’s bank proposal weighs – Reuters
U.S. gold futures ended down on Friday, off their one-month low hit earlier in the session, as President Barack Obama’s proposal to limit banks’ risk-taking pressured the commodity markets …

“V” For…Volcker – Jon Nadler, KitcoPrecious metals continued to struggle overnight, albeit a slight rebound was attempted in gold as the US dollar eased following perceptions that President Obama’s plan to rein US banks in could dent demand for US assets (the greenback among them). Very mild physical buying emerged overseas, as would-be owners ponder whether the yellow metal might still find itself under $1075 or, perhaps $1000 before this phase is over …

2010 Silver Eagle Sales Top 2.4 Million – WorldMintCoins.com
The United States Mint sold 2.48 million 2010 American Silver Eagle bullion coins within two days of their Jan. 19 launch, representing more than 8.6% of the total sold as compared to the record-breaking sales in 2009. Why was there such a significant surge? Eagle demand had built up as a result of their delayed release. Newly dated issues are normally available at the very beginning on January. However, the US Mint decided to continue striking 2009-dated eagles late into last year as a result …

US Mint 2010 Silver Eagles Explode – CoinNews In what has become almost a weekly routine of late, the United States Mint again reported unimpressive sales according to their latest figures. A few bright spots did emerge, however. The most impressive gains come not from a numismatic item, but from the US Mint’s bullion coins. Recall that the bullion 2009 American Silver Eagles sold out on January 12th, with 2010-dated coins not appearing for sale until this last Tuesday. The situation left authorized purchasers with no silver bullion options for almost a full week …

the drop of gold is not due to dollar this time. it is simply the stock market going south. the stock market up almost 100% from its low. it is time for the stock market to correct downward at least 25% to 30%. see february the month of darkness for stocks. while gold might hit record high again.